Last Monday, the International Energy Agency released a report which provides yet more evidence that the world may be facing serious, unprecedented problems with global oil supply. The IEA, a Paris-based agency created in the 1970s by the developed nations of the world to provide data about the world’s energy situation, is normally very conservative when it comes to projecting future energy supplies. It is, therefore, quite sobering to read this most analysis, because there’s a good chance that reality is even worse than what the agency is saying. From the executive summary:
“Despite four years of high oil prices, this report sees increasing market tightness beyond 2010, with OPEC spare capacity declining to minimal levels by 2012. A stronger demand outlook, together with project slippage and geopolitical problems has led to downward revisions of OPEC spare capacity by 2 mb/d in 2009. Despite an increase in biofuels production and a bunching of supply projects over the next few years, OPEC spare capacity is expected to remain relatively constrained before 2009 when slowing upstream capacity growth and accelerating non-OECD demand once more pull it down to uncomfortably low levels.”
Recent Comments